Eik fasteignafélag hf.: Interim results for the first nine months
of 2024
The Interim Consolidated Financial Statements of Eik
fasteignafélag hf. for the period 1 January to 30 September 2024
were approved by the Company’s Board of Directors and CEO on 31
October 2024.
- Income from operations amounted to ISK 8,514 million
- Thereof, rental income amounted to ISK 7,328 million
- EBITDA amounted to 5,537 million
- Total comprehensive profit amounted to ISK 3,326 million.
- Net cash from operations amounted to ISK 3,551 million.
- The book value of investment properties amounted to ISK 139,957
million.
- The book value of assets for own use amounted to ISK 5,893
million
- Change in value of investment properties amounted to ISK 4,345
million.
- Cash and cash equivalents amounted to ISK 1,683 million.
- Interest-bearing debt amounted to ISK 82,567 million
- Equity ratio was 33.2%.
- Earnings per share was ISK 0.97.
- Economic occupancy rate was 93.6%
- Weighted indexed interest was 3.55%.
- Weighted unindexed interest was 7.67%.
In case of any discrepancy in the English and the Icelandic
versions of this announcement or the Financial Statements, the
Icelandic version shall prevail.
Attached is the Interim Consolidated Financial Statements for
the first nine months of the year 2024.
Operations of the period
The Company's operations were in line with the Company's updated
plans. The Company's operating income for the first nine months of
2024 amounted to ISK 8,514 million. Of this, rental income
was ISK 7,328 million. Operating expenses amounted to ISK
2,935 million and impairment of trade receivables was ISK 42
million.
Operating profit before changes in fair value change and
depreciation amounted to ISK 5,537 million compared to ISK 5,776
for the same period last year. Profit before income tax amounted to
ISK 4,157 million and Other comprehensive income for the first nine
months of the year amounted to ISK 3,326 million.
The NOI Ratio (i.e. operating profit before changes in value and
depreciation as a ratio of lease income) was 73.4% for the first
nine months of the year 2024, compared to 74.6% for the same period
in 2023, adjusted for reversal of impairment of trade receivables
in 2023.
The Group's investment properties are valued at fair value in
accordance with International Financial Reporting Standards (IFRS),
which is based on, among other, discounted future cash flows of
individual assets. Changes in fair value are recognized and
classified within changes in value of investment properties and
amounted to ISK 4,345 million in the first nine months of the year
2024. The main assumptions driving the change are inflation, new
agreements and lower return on equity. The main factors
contributing to a decrease are an increase in financial cost and an
increase in property valuation.
Financial Position
The Group's total assets amounted to ISK 150,146 million at the
end of the period, whereof investment properties amounted to ISK
139,957 million which consist of real estate leased to tenants
amounting to ISK 129,040 million, investment properties under
development ISK 4,687 million, building rights and land ISK 3,666
million, pre-paid street construction tax ISK 13 million and leased
assets amounted to ISK 2,550. Assets for own use amounted to ISK
5,893 million and assets under development ISK 1,092 million. The
Group's equity amounted to ISK 49,809 million at the end of the
period and its equity ratio was 33.2%. At the Group’s Annual
General Meeting on 11 April 2024 a dividend payment to shareholders
due to the year 2023 amounting to ISK 2,540 million was approved,
which was subsequently paid on 30 April 2024.
The total liabilities of the Company amounted to ISK 100,337
million on 30 September 2024. Of this, interest-bearing liabilities
were ISK 82,567 million, and deferred tax liabilities were ISK
13,335 million. The Company's loan-to-value ratio, i.e. the net
position of interest-bearing debts against the value of real
estate, building permits, and plots, was 56.1%.
In the third quarter, the Company issued a new bond, EIK 050734,
in the amount of ISK 5,000 million at an indexed interest rate of
3.95%. The Company also paid off a bond, EIK 24 1, which was
non-indexed in the amount of ISK 3,000 million.
During the first half of the year, the Company refinanced ISK
8,800 million of unindexed loans at variable rates with ISK 10,800
million indexed loans at variable rates. Additionally, the Company
issued bonds in the amount of ISK 1,300 million at a fixed interest
rate. The ratio of the Company's indexed loans at the end of the
period was just over 97%.
Economic occupancy rate
The Company's occupancy rate was 93.6% at the end of the period
and was unchanged between quarters.
At the beginning of the year, the Company expected the occupancy
rate to be 92.8% at the end of the third quarter, so the rental has
performed better than expected. Additionally, the Company has
leased out approximately one-third of the development square meters
that the Company expects to become income-generating by the end of
2025. As these square meters were classified as development square
meters, they have little impact on the occupancy rate as
development square meters are not considered rentable units while
development takes place. When development square meters move below
the occupancy rate parallel to the rent, the number of leasable
square meters increases by as many square meters as the rented
square meters, and therefore has little effect on the occupancy
rate.
Outlook
The Company expects the EBITDA for the year to be in the range
of ISK 7,295 – 7,515 million at a fixed price, based on the
consumer price index for inflation adjustment in November 2024.
Takeover bid
Eik's shareholders received a takeover offer from Langisjór ehf.
on 20 September 2024, where a mandatory bid obligation had arisen
because the offeror and parties considered to be in collaboration
with it, on the basis of the Act No. 108/2007 on Securities
Transactions, had acquired more than 30% of the voting rights in
Eik. The results of the takeover bid were published on 18 October
and Langisjór and its partners hold 1,106,529,154 shares in Eik, or
the equivalent of 32.32% of the Company's share capital.
Online meeting
An online open meeting will be held on Friday the 1st of
November 2024, at 8:30 GMT. Garðar Hannes Friðjónsson, CEO and
Lýður H. Gunnarsson, CFO, will present the results and respond to
questions following the presentation.
Registration of the meeting is through the following link:
https://vimeo.com/event/4669498
Following registration, participants will receive an e-mail with
further information’s.
Market participants can submit questions for or at the meeting
to the email address fjarfestatengsl@eik.is. The directors
encourage market participants to submit questions for the meeting
so that answers can be prepared, if necessary. Questions will be
answered after the presentation.
Financial calendar
Following is the planned date for the publishing of the annual
results:
Annual results
2024
13. February 2025
Publishing of finance information will be done after the closing
of the markets.
For further information please contact:
Garðar Hannes Friðjónsson, CEO, gardar@eik.is, s. 590-2200
Lýður H. Gunnarsson, CFO, lydur@eik.is, s. 820-8980
- 3F 2024 Condensed consolidated interim financial statement
Eik Fasteignafelag Hf (LSE:0R70)
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